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Global imbalances, triangular trading patterns, and the yen/dollar exchange rate

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  • Thorbecke, Willem

Abstract

Trade imbalances between Japan and the U.S. could cause the yen to appreciate against the dollar. Evidence presented here indicates that this could increase the U.S. trade deficit with Japan. An appreciation of the yen against the dollar would also cause the yen to appreciate against the RMB and other currencies in East Asia with heavily managed exchange rate regimes. Results reported here indicate that this would reduce the flow of capital and intermediate goods from Japan to East Asia, forcing firms to economize on sophisticated technology-intensive inputs that are difficult to procure elsewhere. This problem would be mitigated if countries in developing Asia adopted more flexible exchange rate regimes. J. Japanese Int. Economies 22 (4) (2008) 503-517.

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  • Thorbecke, Willem, 2008. "Global imbalances, triangular trading patterns, and the yen/dollar exchange rate," Journal of the Japanese and International Economies, Elsevier, vol. 22(4), pages 503-517, December.
    • Handle: RePEc:eee:jjieco:v:22:y:2008:i:4:p:503-517
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    Cited by:

    1. Thorbecke, Willem, 2014. "The contribution of the yen appreciation since 2007 to the Japanese economic debacle," Journal of the Japanese and International Economies, Elsevier, vol. 31(C), pages 1-15.
    2. Andrea Fracasso & Stefano Schiavo, 2009. "Trade-imbalances networks and exchange rate adjustments: the paradox of a new Plaza. The XIVth Spring Meeting of Young Economists (SMYE-2009), Istanbul, April 2009," Post-Print hal-01053278, HAL.
    3. Willem Thorbecke, 2015. "Understanding Japan's Capital Goods Exports," The Japanese Economic Review, Japanese Economic Association, vol. 66(4), pages 536-549, December.
    4. Thorbecke, Willem & Kato, Atsuyuki, 2011. "The Effect of Exchange Rate Changes on Japanese Consumption Exports," ADBI Working Papers 298, Asian Development Bank Institute.
    5. repec:hal:spmain:info:hdl:2441/10028 is not listed on IDEAS
    6. Nobuaki Hamaguchi & Silvio Miyazaki & Leonardo Correia, 2014. "State Space Application to Recent Automobile Sector Triangle Trade between Japan and Latin America," Discussion Paper Series DP2014-05, Research Institute for Economics & Business Administration, Kobe University.
    7. Thorbecke, Willem, 2008. "The effect of exchange rate volatility on fragmentation in East Asia: Evidence from the electronics industry," Journal of the Japanese and International Economies, Elsevier, vol. 22(4), pages 535-544, December.
    8. THORBECKE, Willem, 2009. "Can East Asia be an Engine of Growth for the World Economy?," Discussion papers 09006, Research Institute of Economy, Trade and Industry (RIETI).
    9. repec:hal:wpspec:info:hdl:2441/10028 is not listed on IDEAS
    10. THORBECKE, Willem, 2012. "Estimating Trade Elasticities for World Capital Goods Exports," Discussion papers 12067, Research Institute of Economy, Trade and Industry (RIETI).
    11. repec:spo:wpecon:info:hdl:2441/10028 is not listed on IDEAS
    12. Veysel Avsar & Kemal Turkcan, 2013. "Exchange Rate Volatility and U.S. Auto-Industry Exports: A Panel Cointegration Approach," International Journal of Economics and Financial Issues, Econjournals, vol. 3(4), pages 772-787.

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